The Saucon Valley School Board is considering taking on more energy projects under a state law that guarantees districts will recoup the costs of the work through annual energy savings.

Tuesday night the board was presented with various projects to boost energy savings and switch the district’s reliance from electricity to natural gas energy. A second option involves installing a full backup generator allowing the district to go off the grid at times of peak demand.

The projects carry a total $2.58 million price tag, or $1.37 million and $1.2 million respectively, in addition to the $1.6 million Saucon’s already spent. Contractor Johnson Controls financially backs the guarantee that the work will pay for itself over 15 years.

Currently, Johnson promises Saucon will save $168,000 a year through upgrades to water pumps, the pool and lighting, which the board approved in June of 2011.

Four months into the savings verification process, Saucon’s saved $102,000 so things are going well, said Joe Solomon, of Provident Energy, which is assisting the district.

Director Edward Inghrim said private industry looks for a five year payback so a 15 year payback doesn't seem very attractive.

The school district will still be in business in 15 years, unlike private companies where there are no such guarantees, said Phil Solomon, of Johnson Controls. The district will still have to take on these costs even if it opts out of the current project today, he said.

The first proposal calls for replacing 15 rooftop HVAC electrical units with gas-fired models to reduce heating and cooling costs. Saucon spends about $4,000 a year trying to keep the aging units running. It also includes replacements of boilers as well as a high school generator that costs about $9,000 a year in repairs, said Phil Solomon, of Johnson Controls. The two Solomon's are not related.

Savings from that first phase of work total $1.376 million, not enough to cover costs, Phil Solomon said. But that financial analysis doesn't take into account replacement and repair costs for the rooftop units if they aren't replaced, he said.

When you bundle in the second project with the others, the net savings exceed all of the costs, Phil Solomon said. The second phase calls for installing a natural gas generator capable of keeping the district open during emergencies as long as gas is available. Saucon’s current generator is diesel-fired and can only run for 48 hours.

Typically under the Guaranteed Energy Savings Act, the winning contractor finds a bank to loan a district money for 15 years. A district then uses the guaranteed savings to make the annual loan payments.

For its first project, Saucon opted to tap $3.3 million in unspent bond money; thus avoiding interest costs while still netting the savings.

If the projected savings aren't realized, the company is required to still reimburse the district.

Director Sandra Miller suggested Saucon could borrow from its savings to fund the work and replenish it with energy savings. Follow @sarasatullo